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Mike Templeton is an experienced marketer with a history in building community on the web.

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Three Leading Social Media Agencies Acquired – A Sign of Things to Come?

The big news today is that the Austin-based branded community provider Powered Inc. has acquired three other social media agencies.

As social media becomes a larger focus for brands and organizations, and we get past the experimental phase and into the operational stage of social media, I believe this will continue to happen. With more consumers and money shifting to social media, traditional agencies are doing everything they can to get up to speed, but it’s likely they’ll buy their way there instead of building it.

Even within the social media industry, acquisitions and partnerships are already being made. Ant’s Eye View expanded their colony by acquiring popular business authors and renowned bloggers Ben McConnell and Jackie Huba. Dachis Group crossed the Atlantic through it’s acquisition of Headshift. And the Altimeter Group tripled in size when Jeremiah Owyang, Deb Schultz, and Ray Wang announced they were joining Charlene Li’s venture.

Build it or buy it?

Today’s big deal puts another tally in the acquisition corner, but it’s not a surprise. We’ve even seen these tactics being employed by Des Moines -based Meredith Corporation. Their interactive division (now Meredith 360°) has been scooping up service providers left and right over the past few years.

Also, as Aaron Strout discusses in his blog post about today’s acquisition, Powered feels this situation is the solution that businesses and marketers are looking for:

“We felt like it was important to take this approach because up until now, marketers have lacked a “go to” resource that could meet all of their social needs.”

Is a consolidated marketplace inevitable?

With the seemingly high number of companies looking to address the social media space in Des Moines, how long will it be before businesses start being assimilated into larger companies? Or are traditional agencies content with trying to develop these skills in-house? Or is there still room for more people to do social media consulting?

In the fast-paced, cut-throat world that we are all doing business in, I think acquisition is a very likely scenario for agencies, just like brands themselves are bringing talent inside their organization.

Will there be a fallout of social media companies in Des Moines? Can more be achieved through a united front and working together?

3 Responses to “Three Leading Social Media Agencies Acquired – A Sign of Things to Come?”

  1. Mike,
    This is a great post, full of good thoughts, questions and concerns for Des Moines. I think there are many important things to comment on about this post. First off, I think there are many great people around the country that are making a name for themselves via social media. These people consist of people brands, brands, businesses and social media celebrities if you will. I think for many having backgrounds in journalism, advertising, marketing, promotion and information technology, social media makes sense. I think it would be fair that some want to hold on to the old ways, but see the “trend” and endless possibilities with the every improving field of technology. As a world and culture we are moving forward, we have to.

    As for my thoughts about building it or buying it. I think this is really up to those wanting to utilize social media, that being a business, an entrepreneur or corporation. I believe that it’s value that sells social media. What can you offer different from another company? I don’t feel that people looking to invest in social media are so concerned with price, but more for quality and value. Now that there are several in Des Moines and throughout the Mid-West, people (consumers, customers and clients) have options. They may want to do business with you, because they like you, there is a level of unspoken mutual trust. I also believe that if we were to compete with price, it would be very close across the board.

    Another key aspect in my opinion about using one consulting company over another is what services are they selling/ providing? I think some businesses are on the ladder with what they want out of social media. Do they have objectives and goals for utilizing social media? If not, then they may not be able to make a well informed decision about who to do business with and possibly pay more for nothing (not the case in Des Moines, I might add. All offer outstanding value and wisdom). There are people who want that ROI in the books, they want to see numbers. For some, they want to see value in analytics and a return on ROI. I think others are looking to build lasting relationships with their consumers/ customers and some to little on the numbers. I think for someone looking to venture in the direction of a consulting of social media, they need to know what they want from that too. Some people are looking for education and others are looking for strategy.

    My personal opinion, I would love to see the standing social media specific consulting companies be able to take what I feel they want, a small piece of a big pie. I believe there is enough to go around. We as people, as a community, as a culture and as advocates of something bigger than we are can learn, grow and build together. If we fight, we will loose and for nothing. I think we all need to make a living, that’s a fact, but in doing that does it mean we need to buy up everything we can? I don’t know.

    I do believe the smaller the consulting company, the more they can offer. I have no grounds or facts on what I say for that, but I believe that you can only offer so much. With social media, I don’t think you want to be stretched too thin. You don’t want to take on more and more clients, then not be able to service them. I do believe that some of the small consulting companies have low overhead, which allows for this. I also think they may be able to offer a different type of service, not better, just different.

    What I think could or may happen in Des Moines is one of a couple things. One, some of the bigger companies may look to hire some of the consultants of social media who do it on their own or from small agencies. Two, that they may look to buy some of the small agencies and run them as small agencies to keep overhead low, to offer value and service several big, medium and small clients, etc. Three, that we will all decide to open the biggest and best social media consulting agency there is and all work together for each other to continue to build something that is much bigger than we are. Four, that those in bigger companies doing social media will see the appeal of starting something from nothing or with several others and start other small to medium size consulting agencies.

    I think the big question is, if we have some amazing stand up social media consulting agencies, do we have to focus on building a customer base in Des Moines? Why can’t Des Moines/ Iowa be the capital of killer social media consulting agencies, doing business from coast to coast? We have the numbers, the wisdom and the drive.

    One fear I do have is a big “Brand X” consulting company coming in that offers no value or wisdom but has more market share. They would come in with more people, more man/woman power, more money and more ways of getting UP in peoples faces. I don’t want to see a Wal-Mart style consulting company ruin what much of us have built and continued to pour time and blood into. Would you agree?

  2. [...] already seen a fair amount of consolidation among social media agencies and consultancies, as well as acquisition of social media firms by ad agencies and PR firms alike.  I would be [...]

  3. great news. i wish we would finally get out of the experimental phase in europe too, but it seems that companys here still don’t realise the potential of social media. Well, the good thing is, that it will probably not take too long anymore, until social media and the possibilities of marketing in that field will be more accepted here.

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